The proposal's broad goals are to characterize the time-course of differentiation of neural systems important in language and sensory processing in normally developing children ages 3 months to 8 years. The proposed research will test the following hypothesis--systems that display the greatest degree of developmental plasticity differentiate over longer time periods than do those that are less modifiable. Studies of children at risk for language impairment (Late Talkers, LTs) and children with a diagnosis of language impairment (LI) will be observed. to test the hypothesis that alterations in multiple systems can lead to LI, can be predictive of LI, and are altered by intervention programs. Studies of congenitally deaf children acquiring ASL explore the role of specific types of sensory input hypothesized to be central to the development of the language systems of the bran. ERPs will be recorded over several brain regions as normal, LI, and deaf children process stimuli designed to activate specific aspects of sensory and language functions. Six specific hypothesis will be tested: (1) By 30 months, distinct neural systems mediate lexical versus grammatical processing; these systems display increasing differentiation until 8 years. (2) Children will show ERP evidences of phonological priming at 6 months, but the associated neural systems will continue to develop throughout middle childhood. (3) Systems important in processing rapidly presented non-language auditory stimuli differentiate along an earlier time-course than language-relevant neural systems, and the dorsal visual pathway differentiates along a longer time-course than the ventral visual stream. (4) The timing and organization of the earliest responses to speech and non-speech stimuli predict which LT children will catch up and which will go on to become LI. (5) In some individuals, LI arises from deficits in sensory processing while in others the deficit is specifically linguistic. (6) The biologically invariant role of language systems in the left hemisphere follows a similar time-course for both spoken and signed languages.